The Cashless Economy from the Perspective of SMEs: Review of Research and Recommended Directions for Future Studies
DOI:
https://doi.org/10.15678/KREM.2024.1004.0202Keywords:
cashless economy, payments, enterprises, SMEsAbstract
Objective: The aim of the paper is to provide a critical evaluation of empirical studies on cashless payments and the cashless economy from the perspective of small and medium-sized private enterprises and to identify research gaps in this area.
Research Design & Methods: The article is a review of empirical research on the cashless economy from the perspective of enterprises. The review relates to theory, methodology and contexts applied in studies published over a period of the last 15 years. It also includes the analysis and synthesis of findings from the studies relating to individual countries.
Findings: Future research should concentrate on several areas, including: identification of the opportunities and threats related to the perspective of an entirely cashless economy for enterprises of different scales of activity and representing different sectors, identification of the barriers and drivers related to the cashless economy from a businesses’ perspective and defining the potential strengths and weaknesses of fully cashless enterprises in the contemporary economy.
Implications / Recommendations: Filling the identified research gaps requires a holistic approach to payments in enterprises. It requires collection and analysis of data covering businesses representing different scales and industries, and using both quantitative and qualitative methods.
Contribution: The article provides a synthesis of current knowledge, identifies research gaps, and suggests directions for future research in the field of cashless economy.
Downloads
References
Abebe, F., & Lessa, L. (2020). Factors Affecting Mobile Payment Adoption by Merchants in Ethiopia. African Conference on Information Systems and Technology, 13. Retrieved from: https://digitalcommons.kennesaw.edu/acist/2020/allpapers/13 (accessed: 5.09.2022).
Achor, P. N., & Robert, A. (2012). Shifting Policy Paradigm from Cash-based Economy to Cashless Economy: The Nigeria Experience. Afro-Asian Journal of Social Sciences, 4(4), 1–16. Retrieved from: http://www.onlineresearchjournals.com/aajoss/art/124.pdf (accessed: 18.02.2022).
Akana, T. (2021). Changing US Consumer Payment Habits during the COVID-19 Crisis. Journal of Payments Strategy & Systems, 15(3), 234–243.
Arango, C., Huynh, K. P., Fung, B., & Stuber, G. (2012). The Changing Landscape for Retail Payments in Canada and the Implications for the Demand for Cash. Bank of Canada Review, Autumn, 31–40.
Arango, C., Huynh, K. P., & Sabetti, L. (2015). Consumer Payment Choice: Merchant Card Acceptance versus Pricing Incentives. Journal of Banking & Finance, 55, 130–141. https://doi.org/10.1016/j.jbankfin.2015.02.005
Ardizzi, G., Nobili, A., & Rocco, G. (2020). A Game Changer in Payment Habits: Evidence from Daily Data during a Pandemic. Questioni di Economia e Finanza (Occasional Papers), 591. https://doi.org/10.32057/0.QEF.2020.591
Arvidsson, N., Hedman, J., & Segendorf, B. (2017). Cashless Society: When Will Merchants Stop Accepting Cash in Sweden. A Research Model. In: S. Feuerriegel, D. Neumann (Eds), Enterprise Applications, Markets and Services in the Finance Industry. FinanceCom 2016. Lecture Notes in Business Information Processing, Vol. 276 (pp. 105–113). Springer. https://doi.org/10.1007/978-3-319-52764-2_8
Auer, R., Cornelli, G., & Frost, J. (2020). COVID-19, Cash, and the Future of Payments. BIS Bulletin, 3.
Bergman, M., Guibourg, G., & Segendorf, B. (2007). The Costs of Paying – Private and Social Costs of Cash and Card (Sveriges Riksbank Working Paper Series No. 212). Sveriges Riksbank.
Bhatt, R. (2021). The Importance of Cashless for Impact in Growth Markets. APIS Partners.
Borzekowski, R., Kiser, E. K., & Ahmed, S. (2008). Consumers’ Use of Debit Cards: Patterns, Preferences, and Price Response. Journal of Money, Credit and Banking, 40(1), 149–172. https://doi.org/10.1111/j.1538-4616.2008.00107.x
Bounie, D., François, A., & Van Hove, L. (2016). Consumer Payment Preferences, Network Externalities, and Merchant Card Acceptance: An Empirical Investigation. Review of Industrial Organization, 51(3), 257–290. https://doi.org/10.1007/s11151-016-9543-y
Briglevics, T., & Shy, O. (2014). Why Don’t Most Merchants Use Price Discounts to Steer Consumer Payment Choice? Review of Industrial Organization, 44(4), 367–392. https://doi.org/10.1007/s11151-014-9419-y
Cabanillas, F. L., Slade, E. L., & Dwivedi, Y. K. (2016). Time for a Different Perspective: A Preliminary Investigation of Barriers to Merchants’ Adoption of Mobile Payments. Twenty-second Americas Conference on Information Systems, San Diego.
Cabinkova, J., Knümann, F., & Horst, F. (2019). The Costs of Cash Payments in the Retail Sector. Study to Determine and Evaluate the Costs Arising from Cash Payments in the Retail Sector. Deutsche Bundesbank & EHI Retail Institute. Retrieved from: https://www.bundesbank.de/resource/blob/808970/64a7bec1196c6e3677eb09eb3e827191/mL/kosten-der-bargeldzahlungim-einzelhandel-data.pdf (accessed: 12.05.2022).
Carbo-Valverde, S., Chakravorti, S., & Fernandez, F. R. (2016). The Role of Interchange Fees in Two-sided Markets: An Empirical Investigation on Payment Cards. The Review of Economics and Statistics, 98(2), 367–381. https://doi.org/10.1162/REST_a_00502
Carlos, A., & Taylor, V. (2009). Merchants’ Costs of Accepting Means of Payment: Is Cash the Least Costly? Bank of Canada Review, Winter 2008–2009, 15–23. Retrieved from: https://www.bankofcanada.ca/wp-content/uploads/2010/06/arango_taylor.pdf (accessed: 6.06.2022).
Chairunnisa, S. M., Alfina, A., & Yasmin, A. (2020). Observing Micro, Small and Medium Enterprises (MSMEs) Readiness to Support Cashless Society. The Winners, 21(2), 101–106. https://doi.org/10.21512/tw.v21i2.6722
Chen, L. D. (2008). A Model of Consumer Acceptance of Mobile Payment. International Journal of Mobile Communications, 6(1), 32–52. https://doi.org/10.1504/IJMC.2008.015997
Ching, A. T., & Hayashi, F. (2010). Payment Cards Rewards Programs and Consumer Payment Choice. Journal of Banking & Finance, 34(8), 1773–1787. https://doi.org/10.1016/j.jbankfin.2010.03.015
Citradika, D., Atahau, A., & Satrio, D. (2019). The Use of Non-cash Transactions among Batik SMEs: An Empirical Review from Indonesia. International Journal of Business and Society, 20(1), 397–416.
Danmarks Nationalbank. (2019). Costs of Payments in Denmark. Retrieved from: https://www.nationalbanken.dk/en/bankingandpayments/danish_payments_council/Pages/Theme_Cost-of-payments-in-Denmark.aspx (accessed: 6.06.2022).
Di Maggio, P. J., & Powell, W. W. (1983). The Iron Cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields. American Sociological Review, 48(2), 147–160. https://doi.org/10.2307/2095101
Eisennman, T., Parker, G. G., & Van Alstyne, M. W. (2006). Strategies for Two-sided Markets. Harvard Business Review, 84, 92–101.
Ejiofor, V. E., & Rasaki, J. O. (2012). Realising the Benefits and Challenges of Cashless Economy in Nigeria: Its Perspective. International Journal of Advances in Computer Science and Technology, 1(1), 7–13.
European Commission. (2015). Survey on Merchants’ Costs of Processing Cash and Card Payments. Technical Report. European Commission. Directorate-General for Competition.
Fung, B., Huynh, K. P., & Kosse, A. (2017). Cash Use and Acceptance at the Point of Sale. Bank of Canada Review, Autumn.
Fung, B., Huynh, K. P., Nield, K., & Welte, A. (2018). Merchant Acceptance of Cash and Credit Cards at the Point of Sale. Journal of Payments Strategy and Systems, 12(2), 150–165.
Gorshkov, V. (2022). Cashless Payment in Emerging Markets: The Case of Russia. Asia and the Global Economy, 2(1), 100033. https://doi.org/10.1016/j.aglobe.2022.100033
Górka, J. (2012). Badanie akceptacji gotówki i kart płatniczych wśród polskich przedsiębiorców. Narodowy Bank Polski.
Górka, J. (2013). Efektywność instrumentów płatniczych w Polsce. Wydawnictwo Naukowe Wydziału Zarządzania Uniwersytetu Warszawskiego.
Greenham, T., & Travers-Smith, F. (2019). Cashing out: The Hidden Costs and Consequences of Moving to a Cashless Society. RSA Action and Research Centre.
Harasim, J. (2015). Zwyczaje płatnicze konsumentów a możliwości ograniczenia obrotu gotówkowego w Polsce. Zeszyty Naukowe Uniwersytetu Ekonomicznego w Krakowie, 2(938), 17–30. https://doi.org/10.15678/ZNUEK.2015.0938.0202
Huynh, K. P., Nicholls, G., & Shcherbakov, O. (2019). Explaining the Interplay between Merchant Acceptance and Consumer Adoption in Two-sided Markets for Payment Methods (Bank of Canada Staff Working Paper No. 2019-32). Bank of Canada. https://doi.org/10.34989/swp-2019-32
Ibrahim, P. A., & Zameer, N. (2018). Effect of Cashless Economy on Micro, Small and Medium Enterprises (MSMEs): A Study from Indian Perspective. Journal of Entrepreneurship and Management, 7(1), 17–23.
Jonker, N. (2007). Payment Instruments as Perceived by Consumers – Results from a Household Survey. De Economist, 155(3), 271–303. https://doi.org/10.1007/s10645-007-9062-1
Jonker, N. (2013). Social Costs of POS Payments in the Netherlands 2002–2012: Efficiency Gains from Increased Debit Card Usage (De Nederlandsche Bank Occasional Studies, Vol. 11(2)). De Nederlandsche Bank.
Jonker, N., van der Cruijsen, C., Bijlsma, M., & Bolt, W. (2020). Pandemic Payment Patterns (De Nederlandsche Bank Working Paper No. 701). De Nederlandsche Bank. https://doi.org/10.2139/ssrn.3760322
Karjaluoto, H., Shaikh, A. A., Leppäniemi, M., & Luomala, R. (2020). Examining Consumers’ Usage Intention of Contactless Payment Systems. International Journal of Bank Marketing, 38(2), 75–96. https://doi.org/10.1108/IJBM-04-2019-0155
Kim, L., Kumar, R., & O’Brien, S. (2020). Consumer Payments and the COVID-19 Pandemic: A Supplement to the 2020 Findings from the Diary of Consumer Payment Choice. Federal Reserve Bank of San Francisco.
Kireyev, A. (2017). The Macroeconomics of De-cashing (IMF Working Paper No. 2017/071). International Monetary Fund.
Klee, E. (2008). How People Pay: Evidence from Grocery Store Data. Journal of Monetary Economics, 55(3), 526–541. https://doi.org/10.1016/j.jmoneco.2008.01.009
Klimontowicz, M., & Harasim, J. (2022). Payment Features and Incentives as Drivers for Non-cash Payments Usage – the Evidence from Poland. Annales Universitatis Mariae Curie-Skłodowska. Sectio H – Oeconomia, 56(3), 37–59. https://doi.org/10.17951/h.2022.56.3.37-59
Kosse, A. (2013). The Safety of Cash and Debit Cards: A Study on the Perception and Behaviour of Dutch Consumers. International Journal of Central Banking, 9(4), 77–98. Retrieved from: https://www.ijcb.org/journal/ijcb13q4a3.htm (accessed: 18.02.2022).
Kosse, A., Chen, H., Felt, M. H., Dongmo Jiongo, V., Nield, K., & Welte, A. (2017). The Costs of Point-of-Sale Payments in Canada (Bank of Canada Staff Discussion Papers No. 2017-4). Bank of Canada. Retrieved from: https://www.bankofcanada.ca/wp-content/uploads/2017/03/sdp2017-4.pdf (accessed: 18.02.2022).
Kotkowski, R., & Polasik, M. (2021). COVID-19 Pandemic Increases the Divide between Cash and Cashless Payment Users in Europe. Economics Letters, 209, 110139. https://doi.org/10.1016/j.econlet.2021.110139
Kulisz, M., Bojanowska, A., & Toborek, K. (2021). Consumer’s Behaviour Regarding Cashless Payments during the COVID-19 Pandemic. European Research Studies Journal, 24, Special Issue 2, 278–290. https://doi.org/10.35808/ersj/2224
Kwabena, G. Y., Mei, Q., Ghumro, T. H., Li, W., & Erusalkina, D. (2021). Effects of a Technological-organizational-environmental Factor on the Adoption of the Mobile Payment System. Journal of Asian Finance, Economics and Business, 8(2), 329–338. https://doi.org/10.13106/jafeb.2021.vol8.no2.0329
Liu, Z., Ben, S., & Zhang, R. (2019). Factors Affecting Consumers’ Mobile Payment Behavior: A Meta-analysis. Electronic Commerce Research, 19, 575–601. https://doi.org/10.1007/s10660-019-09349-4
Loke, Y. J. (2007). Determinants of Merchant Participation in Credit Card Payment Schemes. Review of Network Economics, 6(4), 474–494. https://doi.org/10.2202/1446-9022.1130
Mallat, N., & Tuunainen, V. K. (2008). Exploring Merchant Adoption of Mobile Payment Systems: An Empirical Study. e-Service Journal, 6(2), 24–57. https://doi.org/10.2979/esj.2008.6.2.24
Marszałek, P., & Szarzec, K. (2022). Digitalization and the Transition to a Cashless Economy. In: M. Ratajczak-Mrozek, P. Marszałek (Eds), Digitalization and Firm Performance (pp. 251–281). Palgrave Macmillan.
Maurya, P. (2019). Cashless Economy and Digitalization. Proceedings of 10th International Conference on Digital Strategies for Organizational Success. https://doi.org/10.2139/ssrn.3309307
McAndrews, J. J., & Wang, Z. (2012). The Economics of Two-sided Payment Card Markets: Pricing, Adoption and Usage (Working Paper No. 12-06). Federal Reserve Bank of Richmond.
Meng, J. (2020). Evaluating the Moral and Legal Considerations of Banning Cashless Businesses. Social Impact Research Experience (SIRE), 88. Retrieved from: https://repository.upenn.edu/sire/88 (accessed: 5.09.2022).
Moghavvemi, S., Mei, T. X., Phoong, S. W., & Phoong, S. Y. (2020). Drivers and Barriers of Mobile Payment Adoption: Malaysian Merchants’ Perspective. Journal of Retailing and Consumer Services, 59, 102364. https://doi.org/10.1016/j.jretconser.2020.102364
Petrova, K., & Wang, B. (2013). Retailer Adoption of Mobile Payment: A Qualitative Study. Journal of Electronic Commerce in Organizations, 11(4), 70–89. https://doi.org/10.4018/jeco.2013100105
Phinaonyekwelu, N., & Chinwe, N. O. (2020). Effect of Cashless Economy on the Performance of Micro, Small and Medium Scale Enterprises in Anambra State, Nigeria. International Journal of Science and Research, 9(5), 375–385.
Polasik, M., & Marzec, J. (2018). Uwarunkowania akceptacji kart płatniczych w handlu i usługach detalicznych w Polsce. Bank i Kredyt, 49(4), 404–432. Retrieved from: https://bankikredyt.nbp.pl/content/2018/04/BIK_04_2018_04.pdf (accessed: 6.06.2022).
Przenajkowska, K. & Polasik, M. (Eds). (2019). Koszty instrumentów płatniczych na rynku polskim. Raport końcowy z projektu badawczego NBP. Narodowy Bank Polski. Retrieved from: https://www.nbp.pl/systemplatniczy/koszty-instrumentow-platniczych/raportkoszty-instrumentow-platniczych.pdf (accessed: 6.06.2022).
Rafdinal, W., & Senalasari, W. (2021). Predicting the Adoption of Mobile Payment Applications during the COVID-19 Pandemic. Journal of International Bank Marketing, 39(6), 984–1002. https://doi.org/10.1108/IJBM-10-2020-0532
Raya, J. M., & Vargas, C. (2022). How to Become a Cashless Economy and What Are the Determinants of Eliminating Cash. Journal of Applied Economics, 25(1), 543–562. https://doi.org/10.1080/15140326.2022.2052000
Rochet, J. C., & Tirole, J. (2003). Platform Competition in Two-sided Markets. Journal of the European Economic Association, 1(4), 990–1029. https://doi.org/10.1162/154247603322493212
Rochet, J. C., & Tirole, J. (2011). Must-take Cards: Merchant Discounts and Avoided Costs. Journal of the European Economic Association, 9(3), 462–495. https://doi.org/10.1111/j.1542-4774.2011.01020.x
Rogoff, K. S. (2017). The Curse of Cash. Princeton University Press.
Rysman, M. (2007). An Empirical Analysis of Payment Card Usage. The Journal of Industrial Economics, 55(1), 1–36. https://doi.org/10.1111/j.1467-6451.2007.00301.x
Rysman, M. (2009). The Economics of Two-sided Markets. Journal of Economic Perspectives, 23(3), 125–143. https://doi.org/10.1257/jep.23.3.125
Rysman, M., & Wright, J. (2014). The Economics of Payment Cards. Review of Network Economics, 13(3), 303–353. https://doi.org/10.1515/rne-2015-0005
Schmiedel, H., Kostova, G. L., & Ruttenberg, W. (2012). The Social and Private Costs of Retail Payment Instruments: A European Perspective (ECB Occasional Paper Series No. 137). European Central Bank. Retrieved from: https://www.ecb.europa.eu/pub/pdf/scpops/ecbocp137.pdf (accessed: 14.12.2021).
Schuh, S., & Stavins, J. (2016). How Do Speed and Security Influence Consumers’ Payment Behavior? Contemporary Economic Policy, 34(4), 595–613. https://doi.org/10.1111/coep.12163
Simon, J., Smith, K., & West, T. (2010). Price Incentives and Consumer Payment Behaviour. Journal of Banking & Finance, 34(8), 1759–1772. https://doi.org/10.1016/j.jbankfin.2010.02.001
Sinha, N., & Singh, N. (2022). Moderating and Mediating Effect of Perceived Experience on Merchant’s Behavioral Intention to Use Mobile Payments Services. Journal of Financial Services Marketing, 28, 448–465. https://doi.org/10.1057/s41264-022-00163-y
Statham, R., Rankin, L., & Sloan, D. (2020). Not Cashless, but Less Cash. Economic Justice and the Future of UK Payments. The IPPR Centre For Economic Justice.
Stewart, C., Chan, I., Ossolinski, C., Halperin, D., & Ryan, P. (2014). The Evolution of Payment Costs in Australia (Reserve Bank of Australia Research Discussion Papers No. 2014-14). Reserve Bank of Australia. Retrieved from: https://www.rba.gov.au/publications/rdp/2014/pdf/rdp2014-14.pdf (accessed: 14.12.2021).
Szalacha-Jarmużek, J., Polasik, M., & Jakubowska, M. (2022). The Institutionalization of “Cashless Poland”. Values, Norms, Sanctions and Grand Narrations in the SMEs’ Perspective on the Adoption of Cashless Payments. Polish Sociological Review, 217(1), 115–138. https://doi.org/10.26412/psr217.07
Triandis, H. C. (1977). Interpersonal Behaviour. Brooks/Cole.
van der Cruijsen, C., & van der Horst, F. (2016). Payment Behaviour: The Role of Socio-psychological Factors (DNB Working Paper No. 532). De Nederlandsche Bank. Retrieved from: https://www.dnb.nl/media/m4odd4cf/working-paper-532.pdf (accessed: 18.01.2022).
Wakamori, N., & Welte, A. (2017). Why Do Shoppers Use Cash? Evidence from Shopping Diary Data. Journal of Money, Credit and Banking, 49(1), 115–169. https://doi.org/10.1111/jmcb.12379
Wiśniewski, T., Polasik, M., Kotkowski, R., & Moro, A. (2021). Switching from Cash to Cashless Payments during the COVID-19 Pandemic and beyond (NBP Working Paper No. 337). Narodowy Bank Polski.
Yaqub, J. O., Bell, H. T., Adenuga, I. A., & Ogundeji, M. O. (2013). The Cashless Policy in Nigeria: Prospects and Challenges. International Journal of Humanities and Social Science, 3(3), 200–212.
Yeboah, E., Boateng, R., Owusu, A., Afful-Dadzie, E., & Ofori-Amanfo, J. (2020). Assessing the Role of Trust in Merchant Adoption of Mobile Payments in Ghana. In: M. Hattingh, M. Matthee, H. Smuts, I. Pappas, Y. Dwivedi, M. Mäntymäki (Eds), Responsible Design, Implementation and Use of Information and Communication Technology. I3E 2020. Lecture Notes in Computer Science, Vol. 12066. Springer.
Downloads
Published
Issue
Section
License
Copyright (c) 2024 Krakow Review of Economics and Management/Zeszyty Naukowe Uniwersytetu Ekonomicznego w Krakowie
This work is licensed under a Creative Commons Attribution 4.0 International License.
